Procurement delays cut wheat flour supply by 50 percent

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A delay in a two million ton procurement from abroad is harming the supply of wheat and wheat flour for the nation’s bakeries and flour companies.
Bakeries which were receiving 168,000 quintals under normal circumstance are now getting less than 83,000 quintals.
Last Thursday, Shoa Bakery and Flour Factory PLC, which has 16 branches in Addis Ababa and employs 1,150 people, surprisingly hiked its prices. Because they received less wheat flour they increased the price of 100 grams of bread from 1.30 birr to 2.50 birr. Shoa’s 300 grams of bread now costs seven birr.
The Addis Ababa Trade Bureau responded to the problem and gave Shoa their full quota of bread so they resumed to their old prices. Solomon Bekele, the Basic Commodity Distribution head at the Bureau told Capital that the full quota will be applicable when the procured wheat reaches the city.
“Wheat shortages have been a normal situation for a couple of years but to get into a sustainable position we must upgrade local products,’’ he said.
The Ethiopian Grain Trade Enterprise (EGTE) which distributes wheat to nine regions and two administrations is running out of stock and has not given any wheat to flour companies. They said the shortage occurred due to delayed procurement of wheat from abroad.
The Enterprise had been distributing 640,000 quintals of wheat every month to trade bureaus, universities, and prison administrations.
Under normal circumstances Oromia received 125,305 quintals per month while Amhara, and Tigray received 72,550 quintals, 66,417 quintals respectively.
Ethiopian Somali received 21,716 quintals while Afar and Gambela, Beneshangul received 20,875 quintals 20,700 and 20,001 quintals of sugar per month respectively.
The supply in all regions has been cut by more than 50 percent.
Recently Capital reported that the Addis Ababa Trade Bureau in response to complaints from bakeries regarding the price of bread made a study and brought it to the Trade and Industry Minister to adjust the price slightly.
The study which took into consideration the current inflation, the recent devaluation the birr, the price of input materials and the cost of labor and transport recommended increasing prices up to 80 cents. This would mean that 100 grams of bread which is currently sold at 1.30 birr will be sold at 1.50 birr while 200 grams will go for 2.50birr and 300 grams will be sold for 3.80 birr.